Squid Trade in Falklands (SQUID)

CASE NUMBER:

125

CASE MNEMONIC:

SQUID

CASE NAME:

Squid Trade in Falklands

1. The Issue

Argentina's relations with England have been strained since
the Falkland/Malvinas War of 1982. Tensions rose again when
England unilaterally extended its exclusive fishing zone around
the
Falkland/Malvinas during July 1994. England maintained that it
was
protecting the illex squid from over-exploitation. Argentina,
which competes with England and Asian fishermen for squid,
charged
that the English were driven by political motivations. The two
nations have silently competed to strengthen their overlapping
claims to the Antarctic continent. Argentine sovereignty over
the
Falkland/Malvinas and other islands in the area (such as South
Georgia and South Sandwich Islands) would reinforce their claims
to
Antarctica.

2. Description

The English began to colonize the Falkland/Malvinas in
January, 1833 shortly after a U.S. warship expelled Argentinean
settlers. Argentina has vowed to regain these islands since
England took control of them. On April 2, 1982, the Argentine
military invaded the Falkland/Malvinas despite President Reagan's
warning. Though the military government of Argentina had
predicted that England would not react strongly, Prime Minister
Margaret Thatcher moved quickly to retake the Falkland Islands.
Argentina suffered a humiliating defeat during the 1982 war:
Argentina was forced to withdraw from the islands which they
still
claimed. The unpopular military regime was also forced to
relinquish its power.

England and Argentina reestablished diplomatic relations in
1990, but the Falkland/Malvinas still spark political, economic,
and cultural tensions. As recently as January, Argentine
President
Carlos Menem predicted that the Malvinas would again be
Argentina's
by the year 2000. When England expanded their exclusive fishing
zone (around the Malvinas) in July, 1994 by 850 miles, Argentina
became outraged. Britain maintained that it had expanded its
conservation zone to protect the illex squid from over-
exploitation. Argentina countered this explanation by accusing
England of responding to Argentina's 1994 Constitution, which
extends the country's fishing rights to the Falkland/Malvinas.

Until July, England and Argentina had jointly monitored 'the
gap', as the patrol area is called, from illegal fishing north of
the Falkland/Malvinas. Though nationalism and politics have
clouded the environmental issue, the illex squid and other
species
off the coast of the Falkland/Malvinas are in danger of over-
exploitation. Squid's domestic (Argentinean) price has risen
over
sixty percent because of decreases in catches and rising demand
in
Europe and China. Fishing, moreover, accounts for sixty percent
of the Falkland/Malvina Islanders' incomes.

3. Related Cases

Keyword Clusters

4. Draft Author: Jay Krasnow

B. LEGAL CLUSTER

5. Discourse and Status: DISagreement and Allegation
[ALLEGE]

Although Argentina and England continue to exchange
accusations, armed conflict does not appear to be imminent.
Argentine Foreign Minister Guido Di Tella advised U.S. Secretary
of
State Warren Christopher of his concerns, but the United States
has taken no action. Argentina will maintain its position, but
has
not taken any legal action.

6. Forum and Scope: UK and BILATeral

7. Decision Breadth: 2 (UK and Argentina)

While England and Argentina are most concerned about the
protection zone/squid depletion dispute, a large number of
parties
have been involved, are presently involved, or may become
involved
in the future. Principle among the are the 'kelpers' --as native
of the Falkland Islands are known -- who earn a lopsided amount
of
their income from fishing and selling fishing licenses. Many
countries, including China, have a high demand for the illex
squid
for a wide variety of cultural dishes. Greenpeace and the World
Wildlife Fund, which are concerned about over-exploitation of
squid
and other marine life urge that mandatory management and
regulation
of international waters. The European Community, which is also
interested in fishing in the area, has paid Argentina 162.5
million
Ecus to fish 130,000 million tons/year of squid and cod, is still
concerned about disputes over the sovereignty of the
Falkland/Malvinas. Scientists are also concerned about the
potential depletion of the illex squid. A number of marine
biologists consider squid important to understanding the human
nervous system. They view squid as a key to unraveling the
mysteries behind cell transport breakdown which brings on
Alzheimer's and Parkinson's disease.

8. Legal Standing: TREATY and LAW

Argentina's 1994 Constitution extends the country's rights
to
the Falkland/Malvinas, although England does not recognize that
right. The two countries negotiated the expansion of its fishing
zone west of the Falklands so that kelpers (Falkland Island
inhabitants) could meet quotas. According to their treaty,
'kelpers' may fish 150,000 metric tons of squid per year and
Argentina may fish 222,000 metric tons of squid per year.

C. GEOGRAPHIC Clusters

9. Geographic Locations

Since Argentina and England have involved the United States
in the past, the United States remains concerned about potential
conflicts in the South Atlantic. As a member of the Organization
of American States, the United States' interests in the South
Atlantic are almost intrinsic. The 150-year old Monroe Doctrine
also declares that the United States' would protect its interests
in the Western Hemisphere. For political and economic reasons,
non-squid-eating European Community nations are also interested
in the Falkland/Malvinas conflict. During the 1982 war, the EC
placed sanctions on Argentina for invading the South Atlantic island.
If the dispute escalated to armed conflict again, it is almost
certain that they would support England. The Falkland Island Government
(FIG) began issuing fishing licenses to foreign fishermen in
1987. Since then, licensing revenues have been the crown jewels of the
Falkland Islands' economy. In 1992, FIG issued seventy-five
licenses to Spain and sixty-three to Japan. It issued
seventy-one to Taiwan in 1993.

15. Trade Production Identification: SQUID

The product is technically known as illex squid (Illex
argentinus.)

16. Economic Data

17. Impact of Measure on Trade Competitiveness: LOW

Few trade barriers regulation the squidding industry. Some
of them include: a United Nations ban on fishing nets, kelper's
selling of fishing licenses and quotas. If squidding continues
at this rate, the illex squid will be in danger of extinction.
However, the National Marine Fisheries Services reports that
"[a]n effective international fisheries management program is critical
for the Falklands. The annual illex squid fishery is
particularly vulnerable to over-fishing by unlicensed distant-water
fisherman..."

18. Industry Sector: FOOD

19. Exporters and Importers: UK and CHINA

E. ENVIRONMENTAL Clusters

20. Environmental Problem Type: SPLS

21. Name, Type, and Diversity of Species

If the illex squid becomes extinct, it will break a link in
the food chain and affect other species that normally would feed
on it. The species listed below represent the catches of the
kelpers. It is likely that all of them would be affected if fishermen
depleted the illex squid to extinction.

22. Resource Impact and Effect: HIGH and SCALE

23. Urgency and Lifetime: MEDium

24. Substitute: NO

F. OTHER FACTORS

25. Culture: YES

The squid/protection zone dispute was much more a cultural
conflict between England and Argentina than an economic or
environmental dispute. The two countries have not only clashed
over the ownership of the islands, they also have claimed
overlapping wedges of Antarctica (see ANTARC case. However, many nations depend on
squid as an essential ingredient in a wide variety of cultural dishes. Some
these nations include China, France, Italy, Germany, Norway,
Mexico, Morocco, Ethiopia, Russia, India, and Bangladesh. Squid
is also popular in cajun dishes as was extensively eaten in ancient
Rome. The typical illex squid dish might include the following
ingredients:

26. Rights: NO

27. Transborder Issues: YES

Though the United States recognizes England's ownership of
the Falkland/Malvinas, Latin America rallied to Argentina's support
during the war. They had initially condemned Argentina for
violating the non-intervention clause of the Organization of
American States Charter, but then condemned the United States for
not upholding the Monroe Doctrine. The United States pledged to
mediate the Anglo-Argentine conflict of 1982, but undermined its
credibility by eventually supported England and imposing economic
sanctions on Argentina. Though Argentina disputes England's
ownership of the Falkland/Malvinas, the international community
generally accepts England's sovereignty over the islands. The
islanders are of English descent, are loyal to Britain.

28. Relevant Literature

Child, Jack. "The War in the South Atlantic" in United States
Policy in Latin America: A Quarter Century of Crisis and
Challenge, 1961-1986. Martz, John D., ed. The United
States: University of Nebraska Press, 1990.